Great strides on boardroom diversity but still not there
The Institute of Directors (IoD) welcomes the announcement that 100% of S&P/NZX50 companies now have a diversity policy in place, says IoD CEO Kirsten Patterson.
“It is so positive to see that NZX female director new appointments rose to 39% in 2019 from 18% the previous year,” says Patterson.
The proportion of female directors serving within the NZX50 increased from 26.4% in 2018 to 28.4% in 2019 according to the latest NZX diversity statistics released on 31 July 2019.
“However, we’re still slightly behind compared with our usual comparator countries when it comes to the proportion of women serving on top listed boards. Based on latest data, 29.5% of directors in the ASX200 and 32.1% in the FTSE100 are women,” Patterson said.
“While we’re seeing some great strides in achieving diversity in the boardroom, we are not quite there yet. And of course the diversity conversation is not purely a gender issue. The issue is how to get different perspectives to the board table. It’s challenging because it is about so much more than looking diverse. It is about being inclusive in the way that we make up boards, ensuring we are open to finding truly diverse perspectives – those that represent our increasingly diverse nation.
“Diverse thinking is aligned with competence. While competence trumps all, embracing diversity does not mean compromising on skills, experience or professional qualifications. It is a balancing act because we need to spread the net wide enough and ensure it contains the required range of perspectives, strengths, skills and experience that will create just the right balance and ultimately enable the success of the organisation.
“The claim that there is a shortage of diverse talent in the pipeline is pure myth. The Institute of Directors has just over 9,000 members. We see a large pool of talent with diverse backgrounds in our membership and we are proactive in continuing to build a pipeline that adds to it.
According to the 2019 KPMG/WCD Thought Leadership Commission report on diversity, a sampling of studies published in the last few years show that:
• diverse organisations are more successful at retaining talent
• diverse teams are critical for innovation
• mixed-gender boards have fewer instances of fraud
• boardroom diversity strengthens corporate social responsibility performance
• financial success parameters have been correlated with aspects of diversity over numerous and varied studies.